The healthcare industry includes businesses that provide medical services, medicines, medical insurance, healthcare facilities, and medical equipment. Additionally, this sector consists of the providers of health diagnosis, treatment, management, and any other preventive and therapeutic services to individuals.
We will dive into the know-how of the industry and share the answers to the common questions Frontier clients face in the healthcare industry.
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I. Frontier Healthcare Industry Clients
This industry is one of the largest and most complex industries that exists in the United States today. Given the nature of technological innovation and evolution, it is expected to continue to grow. Traditionally consumer-market players are rolling out advancements in medical technology and these changes are pushing the industry and all that participate, to become more patient-centered.
Frontier has worked with many types of healthcare clients including:
The hospital systems are often composed of a group of hospitals that work together to provide a full range of health services, including healthcare insurance. Some of them are privately owned hospitals but a good number of hospital systems are run by non-profit organizations, charities, and religious groups. In the US, hospitals are often required to offer a range of facilities and services such as emergency care, intensive care, and ambulance services. Compared to other healthcare systems around the world, US Hospital Systems are in a unique position to influence innovation and development in the healthcare industry.
Private Physician-Owned Practices
Private practices rival physicians employed by hospitals, while retaining autonomy from larger systems. Though independence is incredibly beneficial, it can be challenging to compete with hospital systems that have ample money to digitally market and promote the physicians it employs. Unfortunately, it is necessary to consider marketing and branding as an independent private practice in order to stay competitive in this highly saturated market.
Medical device manufacturers or med-dev groups make devices such as diagnostic equipment, surgical equipment, blood test equipment, and many other equipment and tools used in hospitals. They are responsible for ensuring that the information they provide is accurate and that the devices they produce are safe to the public. Their many customers are physicians and nurses — knowing what health care providers (HCPs) really want out of the technology they use on a daily basis can make or break the success of a new product.
Private Equity/Venture Capital Firms
The healthcare sector is continuously growing with the rise of the population and the aging community that requires more healthcare services. With new technology integration, the profits taken from the costs of the healthcare provided to patients will rise as well. Capitated healthcare services–also known as concierge medicine–is rising in popularity, and PE firms are at the forefront of this movement.
It’s easy to see why there are private equities looking to venture into the healthcare industry. In the last few decades, the industry has rapidly expanded, and it’s expected to improve throughout the coming years.
II. Types of Business Ventures in the Healthcare Industry
The healthcare sector is composed of a wide variety of companies that are concerned with health-related information, products, and services. It is one of the most important industries in the world as its main concern is the health and wellness of the patient population to which they cater. With this, the industry is lucrative and can spark up various business ventures for entrepreneurs across the globe.
Product Development in Healthcare
Bringing a new product to the market is a complex undertaking that requires years and costs millions to produce. In the healthcare industry, it’s much more challenging as the products and services should adhere to the Food and Drug Administration (FDA) and be HIPAA compliant to even be considered suitable for public use.
That being said, healthcare is a much more sensitive industry and must be handled with the highest level of care as people’s lives are on the line. If the healthcare business wants to stay relevant to an increasingly consumer-oriented society, then product development, especially in new technologies, should be integrated.
As the healthcare industry grows, the demand for technologically advanced healthcare tools and services also grows. For instance, AI and VR are used to help patients train for physical therapy. The number of surgeries performed via robotic assistance is also increasing every day. This goes to show that businesses in the healthcare industries should maximize today’s technology not just to offer better care to their clients but also to utilize technology to become more efficient and productive.
The world’s major healthcare companies all seek to increase their “footprint” in this lucrative market so we’ve seen an increase in mergers and acquisitions (M&A) over the last few years, even with the COVID-19 pandemic being present.
Consolidations of healthcare companies allow for better market penetration, and it usually leads to financial security for hospitals and medical facilities. But they also present a downside as some of the M&A are prompted by their desire to get rid of the competition. This results in a reduction of options for the public alongside the rise of their prices, often without improvements in quality.
III. Common Questions in Healthcare
Frontier healthcare clients are grappling with many questions in this unique industry. Questions you may want to consider if you are operating in this industry include:
- How can we compete and keep up in a technologically adapting market?
- What will the future of our healthcare segment look like (e.g. disease area, therapeutica area, specialty, surgery, research, etc.)?
- How can we grow in an evolving environment like this?
- Do we need partners to succeed in this line of business?
- How can we incorporate telehealth into our service offering while still complying with HIPAA?
If you want to explore the answers to the above questions (and those to follow), reach out to our healthcare team to discuss the implications these problems pose to players in the healthcare industry. We’ve addressed many of them in more detail below:
What’s next for the healthcare industry?
With new technological progress, the latest discoveries in research, and the increasing public awareness of the importance of a healthy lifestyle, the future of healthcare is looking bright.
The healthcare industry is undergoing a massive technological revolution. From electronic medical records to online patient portals and physician-patient matching apps, new technologies are being rolled out that are changing how healthcare is delivered.
What do these changes in technology mean for your company?
These tech innovations happen fast and in order for your healthcare business to survive, you need to adapt to all these changes. On a positive note, as the technology improves, there are a lot more opportunities you can get your hands on.
Will emerging tech outpace traditional forms of healthcare procedures?
The trend of tech advances is on the rise, but new tools come with risk and require new regulations. Other international markets are slow to adopt and are still dependent on traditional healthcare forms. As of today, emerging healthcare tech is still a niche area but it’s best to be one of the early adopters and prepare for its future uses.
How can we grow in an environment like this?
Product development, adapting to new technology trends, and being a patient-centered business go a long way in maintaining the existing system that you have and preparing for the future.
Do our corporate sustainability and responsibility position and corporate brand matter if we do good work?
Companies with a strong corporate reputation are better positioned to attract top workers that highly influence the quality of their service. Benefits like this are often intangible but they can have a significant impact on the long-term success of your organization.
How can we better partner with health systems to support them during the surge and recovery?
Make sure that your health system and its providers are prepared to handle the influx of patients in all value-based care, insurance, providers, and public and private health systems. You must develop strategies that are in line with those of your partners.
How can we better partner with health systems to further our aims as providers?
In many ways, health is a shared responsibility between governmental agencies, healthcare providers, and health professions. Given the enormous demands on clinical and financial resources in this sector, you and your partners must focus on the patient and prioritize their needs.
How should our business model evolve with customers becoming more comfortable with telehealth and remote engagement?
More and more consumers are becoming more comfortable with telehealth and remote engagement. It’s easier for patients with chronic conditions to manage their health on their own terms, while also keeping their doctors in the loop.
Make it so that your business adapts to this increasing trend by creating a platform for patients to simply log in to their personal accounts and interact with their doctor with a few button clicks. It should be very simple and easy to access, especially for the elderly with limited tech knowledge.
Are there opportunistic partnerships or acquisition opportunities that make sense for our company?
There’s a huge focus on consolidation and partnerships in the healthcare industry that allow organizations to grow and expand their reach. You can look for small hospitals and clinics to partner with to improve not just the services you can offer but widen your market in various locations.
How do our commercial model and segmentation approach need to shift in the current environment?
The steady increase in consumerism in healthcare is driven by the adoption of health tech, the aging of the population, and the rise in chronic conditions.
In order to survive in the current environment, your business must be readily prepared to absorb new market innovations and become a market leader in your area of service.
IV. Healthcare Industry Standards
Industry standards are a set of rules that guide the way hospitals and other healthcare facilities operate. It’s the foundation and the common language among all the businesses in this sector.
Health services must follow a certain code of ethics and behavior in order to remain viable. There are regulations on physician-industry relationships, minimum qualifications for doctors, or licenses required to operate. These standards can change as new research and innovations are made and if the standards that govern the healthcare industry are updated.
- Health Insurance Portability and Accountability Act (HIPAA)
- Aims to make health coverage and medical treatment more affordable, more accessible, and more secure.
- FSA/FDA for bigger bodies like medical manufacturing.
- Responsible for protecting public health by assuring the safety of food, drugs, and medical devices.
V. Healthcare: Frontier Case Studies
- Frontier Consulting worked with a Fortune 500 tech company designing a wearable tech device to be used by HCPs in communication/remote instruction applications in Emergency Department settings.
- Frontier worked with a PE firm looking to understand trends in capitated medicine, in addition to the landscape of HCPs in-network for Medicaid and Medicare patients. Our research provided an exhaustive list of independent physician-owned practices in over 150 zip codes that qualified as potential targets based on multiple qualifiers.